Time Warner moots billing based on bandwidth usage

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Time Warner Cable is experimenting with a high-speed internet service that would bill customers based on the amount of bandwidth they consume rather than by flat fee.

The trial is somewhat modest, at least at first. It will begin later this year and is limited to subscribers in Beaumont, Texas, according to Reuters. It is part of strategy to reduce network congestion at Time Warner, the No. 2 cable provider in the US.

Caps and other limitations on network traffic has become a hot button issue over the past few years. Comcast has emerged as the poster child for critics after subscribers complained of Kafka-esque usage caps on the amount of bandwidth they can consume. Comcast also stands accused of terminating customers' BitTorrent sessions, a claim the cable operator steadfastly denies.

Time Warner's foray has already been greeted with skepticism. Bandwidth has come to be viewed with the same sense of entitlement as air and water, and any move to change that isn't likely to be viewed favorably by advocates of net neutrality, who might argue that the tiered billing will penalize people who use bandwidth hogging streaming services or voice over internet protocol applications.

Aside from those issues, it's still not clear if this is simply a ploy by Time Warner to grab more money by charging its most active users higher fees. It will be interesting to know if the provider will discount the rates of subscribers whose usage is relatively modest.

To give Time Warner its due, the operator says that five per cent of its users consume more than half its bandwidth. Assuming that's true, a tiered billing system that, unlike Comcast, clearly lays out the usage caps would be one way for service providers to cope with the growing appetite for bandwidth. We're not sure this experiment is noble, but it's worth watching. ®